AEA shares fall 30pc after profit warning

AEA Technology shares dived 30pc yesterday after the science and engineering services company issued its third profit warning in two years, causing analysts to slash their full-year forecasts.

AEA blamed the scare on several factors, including deteriorating orders from BNFL, delayed orders from the Ministry of Defence for its battery business, and increasing difficulty signing off contracts at its engineering software business, which provides software to oil companies.

Analysts downgraded profits for the year to March 31 from £26m to around £16m. "At first I thought AEA would still make around £20m but clearly it's going to be worse. It's going to be a bit of a bloodbath," said Charles Pick, analyst at Prudential-Bache. Another analyst expects it to make a loss of up to £2.5m, after exceptional items.

AEA said it would make exceptional charges to cover the accelerated rationalisation of its nuclear technology division and its incubator business. It has found a preferred bidder for its nuclear engineering business and said yesterday the sale of its consulting arm was under way.